Contract Account - Terminologies Used - SS3 Accounting Past Questions and Answers - page 1
1
What is a contract?
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A
A formal agreement between two or more parties outlining the terms and conditions of their relationship
B
An invoice requesting payment from a client
C
A purchase order authorizing a contractor to provide goods or services
D
A change order requesting a change to the original terms of the agreement
2
What is a progress payment?
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A
A percentage of the contract value withheld by the client as security for the contractor's performance
B
Payments made to the contractor during the course of the project based on the completion of specific milestones
C
Changes made to the contract or scope of work that affect the agreed-upon price and timeline
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D
A document issued by the client requesting a change to the original terms of the agreement
3
What is retention?
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A
An invoice requesting payment from a client
B
A percentage of the contract value withheld by the client as security for the contractor's performance
C
A document issued by the client authorizing the contractor to provide goods or services
D
Changes made to the contract or scope of work that affect the agreed-upon price and timeline
4
What is a change order?
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A
A formal agreement between two or more parties outlining the terms and conditions of their relationship
B
An invoice requesting payment from a client
C
A document issued by the client requesting a change to the original terms of the agreement
Â
D
Changes made to the contract or scope of work that affect the agreed-upon price and timeline
5
What are variations?
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A
Payments made to the contractor during the course of the project based on the completion of specific milestones
B
Changes made to the contract or scope of work that affect the agreed-upon price and timeline
C
A document issued by the client authorizing the contractor to provide goods or services
D
A percentage of the contract value withheld by the client as security for the contractor's performance
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